Welcome to the presentation of the FY2014 results · 2020-07-08 · Welcome to the presentation of...

Welcome to the presentation of the FY2014 results

Global precision engineering champion with Swiss heritage Focused in technology – diversified in end markets

Agenda

Introduction and overview Heinrich Spoerry 1

Comments on development of key financials Rolf Frei 2

Developments by segments/divisions Jens Breu 3

Outlook on 2015 Heinrich Spoerry 4

Q&A 5

2015-03-06 Presentation FY2014 results / page 2

Highlights in the 2014 financial year (1/2)

Encouraging sales growth

in core business CHF 1,383.0m +5.1%

Proportionately faster EBITA growth CHF 195.4m +10.3%

Important CAPEX for future growth CHF 97.6m +27.4%

Strong R&D activities CHF 34.3m +59.5%

Solid equity financing and balance sheet CHF 1,805.0m +35.1%

Back to a net cash position CHF 87.7m n/a

Increased dividend in line with policy CHF 1.50/share +50%


Highlights in the 2014 financial year (2/2)

Listing on SIX Swiss Exchange on 7 May 2014

Primary Placement CHF 324m

Secondary Placement CHF 380m

Total Placement CHF 704m

Increase of free float to 42.6% due to expiration of lock-ups

Substantial new customer and project wins which will contribute to

future growth namely in the Automotive and Electronics divisions

Increased stake in Indo Schöttle from 45% to 89%, a well positioned

supplier to the Indian and international automotive industry

Improved international manufacturing footprint (China / USA)


Financial Overview

CHF million 2014 2013 adj1 Growth y-o-y

Gross Sales 1383.0 1330.6 + 3.9%

EBITDA

as a % of Operating revenue

271.4

19.5

251.6

19.0

+ 7.9%

EBITA


195.4

14.1

177.1

13.3

+ 10.3%

EBIT


141.5

10.2

124.0

9.3

+ 14.1%

Net Income


110.2

7.9

86.5

6.5

+ 27.4%

Cash net income2) 154.6

11.1

128.2

9.7

+ 20.6%

1) adjusted for book gains on the disposal of non core assets in the amount of CHF 18.3 Millions

2) net income before amortization on intangibel assets net of deferred taxes


Sales breakdown by regions and end markets


1 such as capital goods, reseller, aircraft and medical

Share of sales by region Share of sales by end market

2013

2014

Asia

24.4

North America

9.8 21.3

Switzerland

25.0

Europe

40.8

Asia

24.6

North America

10.6

Switzerland

23.4

Electro and Electronics

24.8

Automotive sector

21.3

Automotive sector

23.9

Europe

41.4

Construction

sector

29.7

Other sectors1

24.2

Construction

sector

27.8

Electro and Electronics

23.9

Other sectors1

24.4

Agenda





Q&A 5


Sales bridge 2013 to 2014 financial year

1'000

1'050

1'100

1'150

1'200

1'250

1'300

1'350

1'400

1'450

2013 Changein scope

FXeffects

Non-coreactivity

Organicgrowth

2014

Sales growth in core business

with 5.1% y-o-y

Growth in all three segments

7.1% in EC

3.4% in FS

1.6% in D&L

Reported sales up by 3.9%

change in scope of

consolidation (CHFm)

Locher - 13

Indo Schöttle +13

negative foreign exchange

(FX) effects -0.9%

sales contribution of non-

core trading activity stable

1,331 0 -12 0 64 1,383

CHF million


Strong contribution margin

62.7% 60.4%

62.2% 63.2%

52.3% 51.4% 52.8% 53.0%

30.4% 28.3% 28.2%

27.9%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

2011 2012* 2013* 2014

CM with 63.2% 100 bps up y-o-y

6.3% CM growth

above-average growth with

profitable products

change in scope of consoli-

dation

Opex with 53% slightly higher

5.0% opex growth

strong innovation and

ramp up activities

% of operating revenue

* CM adjusted for book gains on the disposal of non-core assets and real estate (2012: CHF 4.6m, 2013: CHF 18.3m)

Contribution margin (CM)

Operating expenses (opex)

Personnel expenses


Improved operating profitability

123.7 136.1

177.1 195.4 11.5% 11.5%

13.3% 14.1%

17.3% 17.5%

19.0% 19.5%

0

50

100

150

200

250

300

350

400

0%

5%

10%

15%

20%

25%

2011 2012* 2013* 2014

Operating cash flow (EBITDA

margin) close to 20%

Operating profit (EBITA)

increased by 10.3% y-o-y

EBITA margin improved to

14.1% due to

growth

product mix improvement

productivity gains

Operating leverage 1.6x

6.3% growth CM

10.3% growth EBITA

in % of operating revenue in CHF million

* EBITA adjusted for book gains on the disposal of non-core assets and real estate (2012: CHF 4.6m, 2013: CHF 18.3m)


Increased CAPEX to secure future growth

56.7

67.7

76.6

97.6

5.3% 5.7%

5.8%

7.0%

0

20

40

60

80

100

120

140

160

0%

1%

2%

3%

4%

5%

6%

7%

8%

2011 2012 2013 2014

Capex spending with 7.0%

above target range

share of growth capex 68%

faster than expected ramp-up

of electronic parking brake

advanced demand for

localization

further penetration of new

regions

additional customer wins

ready for future growth

Capex in % of operating revenue Capex in CHF million


Transitory increase of net working capital

107 110

105 110

29.2% 30.1%

28.7% 30.2%

0

40

80

120

160

200

240

280

0%

5%

10%

15%

20%

25%

30%

35%

2011 2012* 2013 2014

Peak in net working capital at

year end 2014

increased activity in Q4 in

Engineered Components

higher A/R outstanding

more work in progess and

raw material

NWC denominated in $

+11% y-o-y due to higher FX

rate CHF/$ 0.989 vs. 0.891

NWC in % of operating revenue NWC Days outstanding

* Operating revenue has been annualized by adding full period effect of Unisteel (Jan - Aug 2012) and Indo Schöttle (Jan – June 2014)


Attractive free cash flow conversion

90

64

139

102

48.4%

31.0%

51.7%

37.7%

0

50

100

150

200

250

300

0%

10%

20%

30%

40%

50%

60%

2011 2012 2013 2014

Freee cash flow CHF 102m

down by 26.7% y-o-y

due to higher NWC and

strong capex

Cash flow conversion 37.7%

below Ø of 42%

Free cash flow = cash generated

from operations after capex

Free cash flow in % of EBITDA CHF million


Stable return on net operating assets

800 916 876 977

105

850 789 845

15.5%

19.1%

20.2% 20.4%

13.7%

10.2% 10.6% 10.7%

0

1'000

2'000

3'000

4'000

0%

5%

10%

15%

20%

2011 2012* 2013* 2014

Operational NOA before

intangible assets (Swiss GAAP)

RONOA I is measured at

pre-tax profit (EBITA)

just above the 20% mark

Total NOA does include

intangible assets (IFRS)

NOA 2014 amounted to

CHF 1,822m

RONOA II stagnates at

10.7% (pre-tax)

EBITA in % of NOA NOA in CHF million

• EBITA adjusted for book gains on disposal of non-core assets and real estate (2012: CHF 4.6m, 2013: CHF 18.3m)

• EBITA has been has been annualized by adding full period effect of Unisteel (Jan - Aug 2012) and Indo Schöttle (Jan – Aug 2014

Solid balance sheet structure

333.0

-424.2

-248.5

87.7

76.5%

54.7%

62.7%

80.4%

-800

-600

-400

-200

0

200

400

600

800

0%

10%

20%

30%

40%

50%

60%

70%

80%

2011 2012 2013 2014

Capital increase strengthened

the balance sheet ratios

Net proceeds from IPO

CHF 311.3m

Equity ratio up to 80.4%

Back to a net cash position

with CHF 87.7m

Equity in % of assets CHF million


Increased dividend in line with policy

0.70 0.63

1.00

1.50

27.0% 27.8%

37.5%

51.0%

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2.00

2.20

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2011 2012 2013 2014

Payout ratio on net income

CHF 1.50 51%

Payout ratio on cash net income

CHF 1.50 36.4%

Payout ratio in % Divdend per share in CHF

1.75


Agenda





Q&A 5


Headlines Engineered Components

Strong sales growth of 8.1 %

y-o-y in core business

Dynamic development due to

launch of numerous projects

Additional innovation projects in

ramp-up phase that will fuel

growth over coming years

EBITA margin lifted slightly

higher to good level of 19.1%

pleasing achievement as

additional costs incurred to

realize innovative projects


Market growth and increased SFS content

Year 2012 2013 2014 2015 2016 2017 2018 2019 2020

Europe 19,285 19,502 20,118 20,021 20,465 21,319 22,104 22,318 22,379

Americas 19,731 20,711 20,807 21,268 21,897 22,463 22,943 23,560 23,767

Asia 42,484 44,534 46,445 48,121 50,393 52,309 54,132 55,632 57,330

Total 81,500 84,747 87,370 89,410 92,755 96,091 99,179 101,510 103,476

Growth y-o-y 6.1% 4.0% 3.1% 2.3% 3.7% 3.6% 3.2% 2.4% 1.9%

Global light vehicle production summary by region (000s)

Source: IHS

Development SFS content per car

Europe Americas Asia

CAGR 2008 – 2014 2.9% 11.4% 16.8%


Market success and technology projects

Highlights 2014 Automotive division

Simultanous ramp up

of high volume

production in North

America, Europe and

Asia to serve global

customers locally

Customer wins for

ABS and brake

systems

Development of ball

screw drive

for future brake

systems


Development of ball

screw drive

for parking brake

applications

Medina (USA)

Heerbrugg (CH)

Nansha (CN)

http://gallery.sfs-intra.net/gallery/var/albums/Automotive/Products/Tiefzieh_04_Neu.jpg?m=1374656894

Growth driver Airbus

Product lines

Current

production

per month

2014 2015 2016 2017 Expected peak production

per month

A320 family. 42 493 502 527 532 46 (April 2016)

A330 10 109 98 98 99 9 (April 2015)

A380 2.7 29 29 30 30 2.7 (April 2014)

A350XWB 2.2 14 32 69 104 13 (2018)

A400M 1.3 13 26 24 24 2.3 (ab August 2015)

Total 658 687 748 789

CAGR 4.6 %

Production schedule Airbus

Source: Airbus


Q1 2015

First success with Chinese smartphone OEMs

Electronics division:

business units Hard disk drives

Smart phones /

mobile devices

Consumer

electronics


Q1 2014

Q2 Q3 Q3 Q2 Q4 Q2

Headlines Fastening Systems

Sales of CHF 336.7 million; 3.4%

growth y-o-y (comparable basis)

Good momentum from industrial

applications

Intensive efforts to upgrade

product range offered under SFS

intec and GESIPA brands

Rapid progress on numerous

programs to improve operating

efficiency; intended benefits

began to emerge

EBITA margin rose to 7.6%

(py: 7.5%)


Market success and technology projects

Highlights 2014 Construction division

Customer wins for ABS and brake

systems


isoweld® project

Fondation Jérôme Seydoux-Pathé in Paris

(FRA)

Market introduction of new

JB-D/L system at 'fensterbau frontale' in

Nuremberg (GER)

Timber construction:

Le Musée de Vin et du Négoce

in Bordeaux (FRA)


GESIPA® - the experts in blind riveting

Highlights 2014 Riveting division

Customer wins for ABS and brake

systems


Worldwide roll out of a demonstration

and technology center concept

PowerBird® Pro Gold Edition

Extremely strong and durable riveting

battery tool generation

TAURUS® 1Speed Rivet,

outstanding magazine riveting tool

FireRex

Development of a pick and place robot

for hexagonal blind rivet nuts TAURUS® Speed Rivet PowerBird® Pro Gold


Headlines Distribution & Logistics

Distribution & Logistics increased

its sales on comparable basis by

1.6% to CHF 319.1 million

EBITA margin excluding non-

recurring items was held at 8.0%.

Margin equates with a high return

on capital given the relatively low

capital employed in this business

Acquisition of major new

customers while expanding

scope with existing customers.

These developments created

future growth potential.


New customer and project wins with logistic solutions

Highlights 2014 Distribution & Logistics

Case 'Swiss premium industrial'

Customer benefit

Standardized solution ready for

roll-out at customer's sites

Increased product range through

integration of third party suppliers

Flexible platform allowing the adaption

new technology trends technology

Additional major customer wins deliver

basis for future growth

Customer 1: CHF 2.0 m





Agenda





Q&A 5


Impact of appreciation of Swiss franc on SFS

The appreciation of the Swiss franc has a significant impact on the

profitability of our Swiss engineering and manufacturing operations

(SFS intec AG) at an exchange rate of 1.05 EUR/CHF

EBITA Margin will drop significantly

The Swiss Distribution & Logistics segment has to share the cost

advantages in the procurement of products from EUR zone or USD

zone with its customers in the form of price concessions

Markets outside Switzerland are not affected by the appreciation of

the Swiss franc

In the translation of sales revenues and operating results

generated in foreign currencies the lower value of these currencies

leads to translation "losses"


Measures to cope with the stronger Swiss franc

Additional measures for future profit enhancements

Profit Improvement Program in Switzerland In Swiss entities:

Hiring freeze reduction of head count by attrition

Increase of weekly working hours from 42 h to 44 h

Reduction of fixed management compensation by 10%

(variable compensation will also decline depending on results)

Reduction of holidays for everybody from 6 weeks to 5 weeks p.a.

Selective price increases on exported products manufactured in

Switzerland

Stringent cost management throughout the group

But: we will maintain innovation efforts and focus on highly

demanding, know-how and capital intensive development and

manufacturing activities


Illustrative impact on EBITA 2015 vs 2014

2014

Planned

2015 growth

at constant

FX-rates

Transaction

impact

FX-Rate 1.22/€

1.05/€

Additional

profit

improvement

program

150


EBITA CHFm

200

2015

estimated

Translation

impact

Outlook for 2015

Good progress achieved in 2014 and good business momentum:

significant new project wins contribute to future growth

technology leadership confirmed

market leadership in targeted niche markets strengthened

Sales growth in core business at constant exchange rates 5 - 7%

(unchanged to prior guidance)

Anticipated decline of reported sales in 2015 financial year at

current exchange rates by 2 - 4% (assuming an average exchange

rate of 1.05 EUR/CHF and 0.91 USD/CHF)

Anticipated decline of EBITA margin from 14.1% in 2014 financial

year by 60 -120 basis points


Agenda





Q&A 5


More than 8,000 employees – one target

Creating value with In Depth Technological Competence

International Presence

Application and Industry Expertise

Long-term Relationships


Disclaimer

This presentation includes forward looking statements. These statements reflect the

SFS Group's current assesment of market conditions and future events. The

statements are therefore subject to risks, uncertainties and assumptions. Unforseen

events may lead to deviations of the actual results from the forecasts and estimates

made in this presentation and in other published information. To this extent all

foreward looking statements in this presentation are subject to such limitations.


Welcome to the presentation of the FY2014 results · 2020-07-08 · Welcome to the presentation of...

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